UOG scoops Tullow’s stake in Jamaican offshore licence

Oil and gas company United Oil & Gas (UOG) has been assigned Tullow Oil’s stake in the Walton Morant licence off Jamaica, which the company now fully owns.

UOG said on Monday that the government of Jamaica assigned Tullow Jamaica’s 80 per cent stake in the Walton Morant licence for a nominal fee.

As a result of the assignment, UOG has now become the operator and the 100 per cent equity holder.

With UOG as the new operator, the initial exploration period over the block was extended by 18 months. The company has until 31 January 2022 before the drill-or-drop decision is required.

The company added that a portion of the licence was voluntarily relinquished with a more focussed area around 22,400 square kilometres remaining that still incorporates all of the identified prospectivity.

United plans to complete a work program to further de-risk the Colibri prospect. It also plans to perform an interpretation of other follow-on targets like Moonraker, Thunderball, Moneypenny, Jaws, Goldfinger, Vesper, Oriole, Earspot, and Rumpspot.

It is worth reminding that the amended Walton Morant Licence has numerous plays and prospects already identified across three separate basins. Eleven wells have been drilled to date – nine onshore and two offshore – and all except one contained hydrocarbons.

Furthermore, UOG invested in an updated independent competent person’s report for the licence in 2019. The report identified a total gross unrisked mean prospective resource of 229 mmstb on the Colibri prospect alone. In high-case scenarios, the gross unrisked resource estimates for Colibri suggest up to 513 mmstb could be recovered.

Tullow in 2018 conducted a 2,200 square kilometre 3D survey over the offshore block, however, it then elected not to proceed into the next stage of the licence. United stated that it acquired the results of approximately $30 million of investment by Tullow in the licence, including the survey.

Brian Larkin, CEO of UOG, said: “Walton Morant has the potential to have a major impact on United Oil & Gas and we are delighted to have successfully agreed with the Jamaican Government to take on operatorship and to develop this licence for the benefit of all stakeholders.

“The United team know this licence well, having worked on it for many years. Our experience and understanding of the licence and conviction about it were critical to the Jamaican Government’s decision to grant us operatorship, 100 per cent interest, and an 18-month extension.

“We are confident in the quality of this licence and in the opportunities that exist not only in the Colibri prospect but across the full 22,400 square kilometre area.

“We will move ahead with a cost-effective programme of activity, building on the significant work that Tullow and United had completed over the last two years and the feedback from a very active farm-down process.  Our goal will be to further de-risk the asset, bring in partners and move ahead to plan a well on the Colibri prospect.”